Finance without strategy is just numbers and strategy without finance is just dreaming – Eberhard Faber
In this rapidly advancing world where any information can be attained or any task can be performed in the blink of an eye, esteemed organizations are growing concerned about tracking their company’s finance for various business operations. This is why they are wading a little deeper into the pool of finance management and thus scrutinizing to implement a financial dashboard that can manage and determine the financial status of a company in real-time.
There’s no denying that financial management is seemingly turning out to be one of the most important responsibilities of owners and business managers. It is with the help of profits, cash flow, and other major financial activities that enterprises feel confident about making financial decisions for the company. There is plenty of real-time financial reporting dashboard software that are aiding businesses to monitor the cash management and finance KPIs. This particularly helps businesses in knowing the detailed monitoring expenditures, revenues, and profits.
In an organization, the majority of finance-related forecasting and cost-benefit analysis are taken care of by CFO (Chief Financial Officer). The CFO of a company is majorly responsible for strategizing financial decisions and discovering the best financial dashboards if required. While we already have had a lot of discussion about financial dashboards and implementation of the same in business, let’s dive deeper into knowing the in-and-out of real-time financial reporting dashboard, benefits of real-time financial reporting dashboard, and many aspects that can lead organizations to financial success.
So let’s embark upon the journey of knowing financial reporting inside-out!
Also, read – How Financial Apps Simplify Businesses?
What Is A Financial Reporting Dashboard?
Understanding the financial reporting dashboard is no rocket science. We know that dashboard is something that particularly organizes and displays the information regarding what that dashboard tool is being used for. Now financial reporting is a data or statement that the CFO reveals a company’s financial status to management or CEO. When an organization monitors all the financial data of a company and sends instantaneous reports by keeping a tool as a medium, this is commonly known as a real-time financial reporting dashboard.
Identifying rapid finance-related business insights, transparency, and being considerate of generating accurate reports is one of the challenges faced by financial experts and CFOs working in a company. The finance management and reporting dashboards eliminate such hurdles and emerge as a pressing priority for businesses.
- Financial management = Financial Planning + Financial Decisions & Controls
Benefits Of Financial Reporting Dashboard For CEOs & CFOs
CEO and CFO are the two main pillars to run a business and lead it towards success. While the former takes the responsibility of holistic business growth the latter taps on ensuring the great care of all the financial activities of a company. Therefore, in order to underpin the importance of financial reporting in an organization, CFO plays a pivotal role. Deliberating the questions like how to take better decisions for the financial dashboard or how to select the best financial reporting dashboard for your business solely accounts to the CFO who eventually discusses and finalizes the insights with the CEO. So what are the benefits of deploying real-time financial reporting dashboard tools in enterprises? Here are some integral advantages of financial reporting dashboard tools that CEOs and CFOs induce.
1- Helps in Collecting & Reporting Data from Diverse Sources:
The primary objective of a financial dashboard is to collect all the relevant financial-related data for a company from inventory, production, employment, etc. These data are obtained for a fiscal quarter or year. Now the financial reporting dashboards collect and report the monetary activities of a company from different sources that aids to the financial insights.
2- Provides a Visual Presentation of Financial Data:
Besides being easy to follow, understand, and enhance the decision-making process, the visual representation of data in the form of charts, graphs, videos, etc. presents the findings in a clear and straightforward manner. With the help of a real-time financial reporting dashboard that creates such data presentation, it becomes easier for management to form a strategy on approaching financial management.
3- Accelerates the Decision-Making Mechanism
It might seem weird but business enthusiasts know very well how great a financial reporting dashboard can substantiate to be in decision making for a company. With the help of modern CFOs dashboard, the financial experts of a company can easily forecast the financial endeavors and settle upon a business decision concerning finance.
4- Sends Alerts to Stakeholders in Case of any Issue
One of the major strengths of a real-time financial reporting dashboard is to automate the email reports to key holders of the company management on a periodical basis. The tools also send the alerts directly in case of an issue concerning financial data or metrics arises.
Since we have gathered adequate insights about the financial reporting and dashboards, let’s elucidate some particulars to the CFO dashboard and what it reports.
An Introduction To CFO Dashboard & Reports
CFO dashboard is a one-of-its-kind tool that enables financial experts including CFO to gain a comprehensive and accurate view of financial data that provides essential business information as well as the financial risks. What sets the CFO dashboard apart from the ordinary financial reporting dashboard is the former focuses on the holistic financial planning of an organization while the subsequent emphasis mainly on just analyzing the reporting in real-time. Unlike real-time financial reporting dashboard tools, the AI-integrated CFO dashboard generally consists of purposeful and static reports that help discover finance issues and risks headlong. Have a look at some significant elements how a financial reporting dashboard can help CFO.
- Analyzes financial capabilities and operational reporting.
- Helps in high-level financial planning and orchestration of the entire firm.
- Enables CFOs to make more informed, strategic financial decisions.
- Connects CFOs to multiple data sources.
- Creates a financial report that’s tailored to business necessities.
- Measures a company’s financial performance and compares it with rivals.
CEO vs CFO Roles In Financial Reporting & Management
Without beating around the bush and rather coming directly to the meat of the matter, the greatest role a CEO plays in financial activities in an organization is to provide financial leadership by working closely with the CFO and Board of Members. CEO is the most senior manager of an organization who oversees the activities of the whole organization in which finance is one such activity.
The Chief Executive Officer of the company is highly accountable for maximizing the entity’s value which includes revenues, market share, share price, etc. Since we know that the CEO takes care of an organization as a whole, it is understandable that the role of CEO in financial reporting dashboards is almost negligible as the finance department is overseen by the CFO which we are going to read about in the following paragraph.
Let’s discuss the role of CFO in financial reporting dashboards in detail. Chief Financial Officer, abbreviated as CFO, is commonly referenced as the senior-most finance manager of a company who is deeply involved with the organization’s financial activities such as financial risk management, financial planning, recordkeeping, financial reporting, etc.
As the real-time finance reporting dashboard tools are picking up the steam in the marketplace, the opportunities of carrying out financial activities of a company are becoming uncomplicated for CFOs. Although the CFOs role caters to managing the company’s finance, you might be inquisitive of knowing what is the role of CFO in the financial reporting dashboard exactly?
Well, the financial reporting dashboard quantifies high-level measures of financial performance and makes it easy for CFO to keep an eye on the enterprise’s finance from diverse sources. Keeping the current market trend in mind, the modern CFOs dashboard tools have been introduced in the market that aid CFOs with a very specific set of financial practices.
In order to get the integrative difference between the role of CEO and CFO towards an organization, refer to the given image.
Difference Between Profit & Loss Finance, Finance Performance & Finance Reporting Dashboard
Irrespective of the industry and nature of business, the primary objective of every organization is to outshine its competitors and raise the bottom line. Accomplishing such a thoughtful goal is not unchaste as there are a lot of factors that play a major role in making that happen. Financial management is one of the components that is mostly overlooked by the majority of companies while defining and fulfilling quantifiable financial goals.
Since the use of traditional financial planning methods is numbered, the finance professionals are leveraging real-time financial reporting dashboard tools to stay abreast. Though there are many financial dashboards that companies employ, knowing the difference between the most popular ones can make a difference. Here we have appropriately differentiated between P&L finance, finance performance, and financial reporting dashboard.
7 Financial Dashboards That Help Companies With Financial Management
The advancement of technology and transformation has given companies many different aspects to look at and measure the success within a business operation. It won’t be wrong to say that 21st-century enterprises are driven by tools that are effective in tracking business success and boosting industrial growth. There are various departments operating within an organization itself each of them facing its own set of difficulties to fulfill the requirements. Finance is one such department in a company where financial professionals and departments strive to deliver fast insights, clear and reliable financial reports every then and now.
But things have changed now. Gone are the days when financial experts of the enterprise used to be under extreme pressure while monitoring and reporting the financial status of the company. With the help of financial dashboards, financial tracking in the current era has become easier. There are varied types of financial dashboards in the market catering to the financial needs of the company making the CFO’s job easier than before.
Have a look at the seven best financial dashboards that guarantee the financial success of the company.
1- Cash Management Dashboard
The cash management dashboard is used by the companies to ascertain the enterprise’s liquidity and its ability to pay short-term liabilities if any. Moreover, this dashboard is designed to analyze the payment and debt collection patterns. In short, cash management examines the current ratio and your quick ratio of the company.
2- Financial KPI Dashboard
Since the benefits of financial reporting dashboard are not unknown to the companies, the other dashboards such as financial KPI are also being utilized by the organization nowadays. Every business defines a financial KPI that promotes stable and proactive financial management for an organization. The primary role of financial KPI is to assess the company’s working capital, including current assets and current liabilities.
3- CFO Dashboard
What are the most important factors that play an important role in determining the success of a company at the financial level? There are mainly four elements – Costs, Sales goals, Profit, and Customer or Employee Satisfaction. Though CFO operates as a principal figure in determining the success of the company, the deployment of a modern CFO dashboard is proving to be beneficial for industries.
4- CAGR Dashboard:
CAGR stands for Compound Annual Growth Rate which is one of the most valuable factors for banks, venture capital firms, and many other financial institutions to determine finance analytics. The CAGR dashboard is a way different from the real-time financial reporting dashboard, unlike the latter, the former focuses on showing AUM by business unit.
5- Expense Detail Analysis Dashboard
As the name itself describes, there is a particular dashboard software in the market that evaluates cash inflow and outflow in an organization. Expense detail analysis financial dashboard brings powerful insights to the expense analytics adding more meaning to the financial management.
6- Margin Analysis Dashboard
Analyzing a business’s profitability over time is very important and that is what exactly the margin analysis dashboard does to the enterprises. Moreover, this dashboard software allows organizations to compare the company’s profit margin to the competitors and empower financial strategies as well as to educate businesses on rationalizing more profit.
7- Actual vs Forecast Expense Dashboard
Apart from assessing financial reports with the help of real-time financial reporting dashboard tools, evaluating financial expense over the period is imperative as well. The company needs to be extra careful when it comes to tapping the business expense in a fiscal year. Since differentiating between actual and forecasted expenses could be challenging, it is important to rightly utilize the modern financial dashboard and gain actionable insights concerning the expenses.
Check this post – Top 10 Business Intelligence Tools List for Business Growth in 2021
3 Things CFOs Should Keep In Mind While Choosing A Perfect Financial Dashboard
Over the years, the role of the CFO in an enterprise has drastically changed. Earlier, the CFO was circumscribed to keeping the financial record of the company along with data analysis, however, now the CFO of an organization is gravely involved in enhancing the financial health of enterprises and driving change in companies. Whether it comes to implementing new strategies to accomplish financial goals or opting for undeviating real-time financial reporting dashboard software for the organization, CFO entails complete accountability for the same. Financial dashboard tools are proving to be profitable but choosing a dashboard that gives an effective overview of the financial performance of a business is quite challenging. Therefore, a CFO should be keeping a few significant points in mind to eventually select the best financial dashboards.
1- Dashboard Fulfills the Financial Perspective or Not
Before the CFO of the company gets into the technicality of the financial dashboard, it is better to comprehend whether the particular real-time financial reporting dashboard software which he is going to embrace in the organization satisfies the financial needs of the company or not. Since CFOs predominantly involve in identifying the company’s financial strengths and weaknesses and proposing corrective actions, deciding with the financial vision of a company is also their integral obligation. In order to understand that, the CFO should be mapping out the financial goal in advance and should later be testing them with different indicators.
2- The Metrics Are Defining Objectives or Not
Either it comes to assess business processes or analyze quantified measures for an operation, metrics play an integral role in defining the holistic business purpose. Hence, in order to be sure about how the modern CFOs dashboard could be beneficial from financial prospects or would a particular financial dashboard be the right choice, a CFO of the organization needs to ascertain the metrics of each financial dashboards they have shortlisted before settling upon one. The right metrics can be determined depending upon the business objectives. Narrowing down the choice of metrics is important as the appropriate variables should be providing a broad view of your company’s financial health.
3- Track & Report the Progress for a While
Unless you try the particular tool or software for carrying out business operations, it would nearly be tough to tell whether it specifically fits the requirement or not. Now the CFO has analyzed the organizational objective as well as understanding the defining metrics for a productive financial dashboard, this is the time to use the finalized dashboard for tracking and reporting the company’s financial performance for a while. Not all the features in a real-time financial reporting dashboard tool will be well-suited for your objectives. Some may follow the ideal trend while others will just only track the trend over time. Therefore, it is important to set the target before deploying the software into the business first.
How Appventurez Can Help You Choose the Right Financial Dashboard for Your Company?
The importance of deploying financial dashboards for monitoring the financial activities within an organization is being received well by the business managers. When it comes to analyzing the KPIs, financial data, the key capabilities of financial dashboards reveal themselves as an immense tool that meets the current business demands. However, where the market is overwhelmed with different and potential dashboards, choosing the right one for the business might get challenging. Whether you need a real-time financial reporting dashboard software or a general dashboard that forecasts business analytics and helps you in planning, an expert opinion is considerate. We at Appventurez are endowed with a team of talented peers who aid companies in reaching a conclusive choice.
Therefore, if you are facing any dilemma in choosing a suitable financial dashboard, reach out to us and our expert panel, after collaborating with leading CFOs, will help you form an informed decision.
A young entrepreneurial technocrat who is the Co-Founder & CEO at Appventurez Mobitech. After completion of his masters in Computer Application, he dived into the world of technology as an iOS developer. As a CEO, he firmly believes teamwork and collaboration are the essential tools for any company’s success.
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